Right on. Stronger yen is good for Sony's international sales since it translates into higher revenue for the quarter. On the other hand, the Nikkei to NYSE stock price conversion suffers. This morning SNE closed at 1847 yen which stood at 102.4 per $1 which gave us the price drop. If yen was at 97, we would be around $19 PPS.
It's simple. The stock will move up when investors realize that Sony is selling more products and services than anticipated and that they will beat current profit estimates.
Look at the volume. Anyone with a million shares can move this stock as they please on NYSE. Don't expect this to move up unless big boys decide it's Sony's time.
Take that with a grain of salt. It's probably based on the number of people who requested notifications when PS4 becomes available and most people would have done this at several stores or never bothered to cancel it when they got theirs somewhere else.
On the other hand, even 2 million waiting in US alone is impressive considering that Sony sold over 1 million+ in 24 hours in US and Canada. I'm willing to bet that they will hit another 1 million+ the first day it goes on sale in Europe and again in Japan. Let's see how this compares with the Xbox One which is being rolled out in 13 countries tomorrow.
Actually, most people thought it was closer to a $50 loss, so this is a good news. A well known fact is that most profits will come in from products and services that run on PS4 and not the console itself.
Try patents and growing network business. What do you think will drive the future? A temporary obsession with "smart" phones or the infrastructure they rely on?
If I'm not mistaken, that number was less than $50 per console. Since I got my console on Friday, I purchased 2 games and a second controller (for Knack's co-op game) and will be getting a camera before the year's end for sure (there is no point right now). All-in-all, I have spend almost $200 on accessories so far and I'm certain I'm not the only one.
P.S. The console worked like a charm and almost non-stop for the last 2 days.
Amazon has about 600 negative reviews out of well over 1 million units sold so far. What does that tell you? Or are you also forgetting that Xbox One is coming out this Friday?
There are a few problems with your analysis. One, Sony is making money with every sale because every PS4 owner will buy at least one game and one accessory (another controller or camera). You can safely estimate that each console sold makes on average $100 instantly for the company and will continue bringing in profits over the years.
Two, you completely underestimate the demand for consoles. anyone who thinks that high-definition, large screen gaming is on decline is out of touch the younger generations. Gaming is a way of life for most teenagers and kids these days who now spend increasingly more time playing games than watching TV. There is plenty of room for Xbox One and PS4 in that growing market.
Three, recent drop in pps was driven by short term traders who realized that 100% gain in one year was a decent return and sold. With only a few million shares being traded in US and other places each day, such move is not difficult to envision. It was a great buying opportunity for investors to jump in and for the shorts to cover (you were right about that part).
In light of all that, buying long term puts is a suicide and short term puts is extremely risky.
And there are about 500 "reports" of broken consoles on Amazon... I don't think there is much of a problem here. My PS4 has been running practically non-stop for the last 2 days as it probably is for hundreds of thousands of people out there. Great PS4 launch, Sony!